Hi all, I'm currently reading through the faq's and newbie stuff but I have a question. After OC charges off an account, can there be interest added to the balance at time of charge off? Thank you all, Rob
Interest can be added, but not by the OC. Collection agencies often charge an interest rate if not paid within a 30 day window from time of notification. Once an OC "charges off" a debt, they have claimed it as an uncollectable "bad debt" expense, and usually sell it off to a collection agency.
Question (I am sure you already answered this, but...): If the OC refers the charged-off account (as opposed to selling it) to a CA, can they charge interest?
This is a question about the "murky" details of the business and accounting practices. Technically they(the agency) can, but this gets a bit dirty if the CA is really a "true" arm or division of the OC. If the "CA" is truly "in-house", they should not charge interest, but..most are separately owned divisions under the same corporate umbrella, so they can charge interest.
